Job cuts at hp: missing the boat

Because of the unclear course in smartphone and tablet sales, Hewlett-Packard’s sales are now collapsing. 34,000 employees lose their jobs.

Chief executive Meg Whitman is reorganizing HP. Image: reuters

Another 5,000 employees of Hewlett-Packard lose their jobs against the background of a shrinking PC market. Instead of 29,000 jobs, 34,000 positions will now be eliminated as part of a restructuring and savings program, the U.S. computer maker announced late Monday (local time).

In its annual report, the company cited "continued pressure on the market and the business" as the reason. It was unclear until Wednesday what that meant for German employees. HP CEO Meg Whitman, who has been in office for two years, is trying to stop the descent of the former industry leader with a realignment.

Under the old management, HP had missed the boat in smartphones and tablet computers and also alienated customers in its traditional PC business with an unclear course. The Chinese rival and new PC world market leader Lenovo, among others, profited from this.

HP employees have to pay for the mistakes. In view of the rapid changes in the computer industry and the corresponding slump in sales at HP, the job cuts have taken on ever greater proportions. Originally, Whitman had announced a year and a half ago that about 27,000 jobs would be cut by the fall of 2014.

Abandon Russelsheim completely?

Employees in Germany are also affected by the upheavals. HP had initially announced it would cut 450 jobs in this country. Later, the company let it be known that the Russelsheim site was to be completely abandoned, which would cost another 850 employees their jobs.

"This concludes the contribution from Germany to this savings program," had promised Volker Smid, HP’s country manager at the time. HP Germany was initially unable to comment on the additional job cuts when asked.

According to the company’s headquarters in Palo Alto, California, 24,600 jobs had already been eliminated worldwide by October as part of the savings program, leaving 317,500 employees. The group estimates that the entire restructuring will ultimately swallow up around $4.1 billion (3.0 billion euros), for example through severance payments.

HP had to accept a sales decline of 7 percent to 112.3 billion dollars in the last fiscal year, which ended in October. Sales to private individuals suffered in particular. In contrast, business with corporate customers brightened recently. In addition to PCs and printers, HP also manufactures high-performance servers and network technology. In addition, the company offers software and services.

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